Are $1 stocks a good bet?

12:51 AM,
Jun. 23, 2014

Traders work the floor at the New York Stock Exchange.

Written by

Matt Krantz
Gannett

A: Resist the temptation to think a stock with a low per-share price is a bargain. The truth is usually quite the opposite.

There are currently 11 stocks in the broad Russell 3000 index that trade for $1 a share or less. These are stocks in some serious distress, such as American Apparel, the clothing maker that ousted its CEO this week. Shares of American Apparel closed at $0.69 a share, a breathtaking 64 percent decline from where it was a year ago. Another well-known stock trading for less than a $1 is electronics seller Radio Shack, which closed ...